Just like anything else, not all home buyers are created equally. For example, some investors purchase and renovate a property themselves to resale or rent out. In addition, some wholesalers act as the middleman or broker between a seller and their network of actual investors. Finally, some iBuyers use online property evaluation tools to determine what your house may be worth remotely.
Many people are familiar with the first two categories, but what exactly is an iBuyer, and what value do they provide?
Whether you realize it or not, you are likely familiar with several iBuyers. Companies like Zillow Buyers, Offerpad, Opendoor, Orchard, Knock, RedfinNow, Upnest, and Sundae can all be classified as iBuyers. These companies use online and internal data to create algorithms that attempt to predict the value of your home. They then generally make a site unseen or even automated offer with this value. This sounds great on paper, or in this case on your device screen, but it can have some significant problems in practice.
Getting an offer is easy; the process is not
While the time to get the initial offer may take only seconds, the actual process may take far longer than a true investor. Many iBuyers are national and partner with local wholesaling companies to lead the purchase. As stated above, wholesalers are not the end buyer and will need to find someone to purchase the home for the home to close. This process frequently comes with extra foot traffic in and out of your home, delayed closings, and price reductions. These add layers of confusion and back and forth that you did not initially bargain for with the hope you will roll over from exhaustion.
Your offer is likely to change
Please read the fine print and then reread it. You can expect to find a clause allowing for an extended option period, price negotiation, and even price reduction with any site unseen deal. No two homes are alike. Any severe home buyer will want to lay eyes on your property before making an offer to ensure they know what they are getting into and have budgeted accordingly. Without a visual of the home, you cannot expect a fair offer.
What generally happens is an iBuyer offers a higher value and then reduces it to accommodate repairs only after getting the seller hooked. Or contrarily, they will low ball, to begin with taking more repairs than necessary into account. Like Flash Realty Solutions, true investors will view the property first, take only the necessary repairs into account, and then make a single fair offer.
People are better than robots
iBuyers, or internet buyers, are, in fact, not buyers at all. They are robots. And while we can all appreciate modern technology, there are still some things best completed by an actual person. There are so many factors that go into making your home unique that a robot cannot accurately evaluate them all, significantly when the value for specific features change neighborhood by neighborhood or even street by street. Take a pool, for example. Some areas offer a huge premium for this added feature while others do not, or may even reduce the value. Further, algorithms do not have eyes and cannot consider recent renovations, repairs, or updates. Working with an experienced and licensed real estate professional is your best bet when you want a valid offer.
Let’s break it down further
There’s a better way to sell your home
Flash Realty Solutions offers a stress-free and straightforward sales process by maintaining our human element. Our experienced buyers and agents will take the time to get to know you, your goals, and your home to make a tailored recommendation for you.
A cash offer may be the best option for you, in which case we will provide a fair and accurate offer the first time around. Or perhaps, to meet your goals, a traditional listing is a better option. In this case, we can help you prepare your home for the market and list it for you.
Regardless of your situation or your home’s condition, we have a solution to help you sell and close in a flash! So give us a call at (832) 934-8856 or submit an online inquiry today.